SAP mum, for now, on top-level hires

SAP will announce next week that it has hired several high-profile executives who have been snatched away from top rivals, sources at the enterprise applications specialist have confirmed.

Bill Wohl, SAP's communications chief, said late Thursday that the German software company has attracted some new talent, specifically in the area of applications development, including several "high level" people from its rivals. While Wohl declined to name the executives coming to SAP, he indicated that the software developers are from companies including Oracle, PeopleSoft and Siebel Systems, three of the software maker's closest competitors in the business software arena.

Official announcement of the executive appointments will be made either on Monday or Tuesday, he said.

SAP specializes in enterprise resource planning (ERP) applications, which run internal business systems around operations including human resources, manufacturing and financial management. It also focuses on customer relationship management (CRM) software, which companies use to strengthen ties with their clients.

According to Wohl, it is unusual for SAP to garner so many high-ranking software development executives at once, as he said the company usually has more luck siphoning sales and marketing workers from its competitors. Wohl said that SAP's new hires are on the same level as George Paolini, the company's senior vice president for platform ecosystem development, who joined the firm after working in top development positions at Borland and Sun Microsystems. At Sun, he was a leading figure in the creation of Sun's Java programming language.

Industry watchers said that in addition to strong earnings potential for the company, applications specialists are being drawn to SAP by the presence of Shai Agassi, a board member in his mid-30s who has become the front face for its software design efforts.

Agassi, the youngest member of SAP's board, joined the company in 2001 after the firm bought out TopTier, a portal software firm he had founded and led.

Most recently, Agassi has been fronting SAP's efforts around its Enterprise Services Architecture strategy, an initiative that gives the software maker's partners access to the technical specifications, or blueprints, that detail the inner workings of its products. With the partner program, SAP intends to transform its business application line into a platform on which third-party software providers can build add-ons and specially tuned versions.

According to AMR Research Analyst Bruce Richardson, SAP is building a "war chest of talent" in Silicon Valley, much in the same manner that software giant Microsoft was aggressively recruiting database expertise to its Redmond, Wash., headquarters several years ago. Richardson declined to speculate who the specific individuals being introduced by SAP next week might be.

"Shai has clearly emerged as the guy in the applications space and has been able to pick up really senior people from Oracle, Siebel, BEA Systems and Sun Microsystems," said Richardson. "He's really fleshing out his team with people who have done it before."

Richardson said that SAP is also succeeding at changing its image from someplace where development was slow-moving and tied to complex legacy technology into a software shop that is developing cutting-edge technology in its products.

"In Silicon Valley, people underestimate how much money SAP invests in technology and how passionate their people are," the analyst said. "Oracle always claims that all that SAP (has are) a bunch of applications on a proprietary language and that they're hundreds of years behind state-of-the-art technology, and then you talk to people who join there from places like Sun and BEA, and they're blown away by how smart the SAP people are, and how forward thinking they appear to be."

In addition to luring its rivals' executives, some industry watchers have predicted that the company will also attract some of its competitors' clients. Oracle's acquisition of PeopleSoft closed in January 2005, and the massive merger has caused experts to speculate that some of the two companies' customers will jump to SAP as the newly combined entity works to integrate its various products. Siebel has struggled to meet earnings expectations, and some of the company's investors have called for changes on the company's own board of directors.

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